Though there are estates that will require some complex plans, the majority of people are going to have to concern themselves with two major issues. The first one is very obvious: you must execute a vehicle or vehicles of asset transfer. The most common way to leave your property to your loved ones is through the utilization of a last will.
Though the last will is the most widely used vehicle of asset transfer, it is not always the best one. When you use a last will your estate must pass through the process of probate, which can be lengthy, expensive, and public. Many people choose to avoid probate for these reasons, and the most common way of doing so is through the creation of a revocable living trust.
With these trusts you appoint a trustee, which can sometimes be a bank or trust company, who will administer distributions to your beneficiaries after your death in accordance with your wishes. These asset transfers take place outside the process of probate, and the creation of the trust provides some asset protection for your beneficiaries as well.
In addition to facilitating the transfer of assets, the fundamental estate plan will also include an incapacity planning component. You can protect yourself through the execution of a durable financial power of attorney and a durable power of attorney for health care. With these documents you empower representatives of your choosing to make decisions on your behalf should you become unable to do so due to incapacitation.
These are a couple of the basics, but in the end the best way to truly demystify the process of estate planning is to consult with an experienced estate planning attorney. This type of communication is invaluable, and you will invariably feel a weight lifted off your shoulders when you exit your attorney's office with a solid estate planning strategy having been decided upon.
